EUR/USD slipped lower, trading around 1.1370 on Monday, as early gains were erased and investors adopted a cautious stance ahead of upcoming Eurozone growth data and the Federal Reserve’s policy announcement.
Risk sentiment improved after a de‑escalation in tensions between the United States and Iran, prompting a steep drop in oil prices and a broad rally in equity and bond markets. West Texas Intermediate (WTI) crude fell to around $83.60 per barrel, a decline of more than 7% as worries about supply disruptions eased.
Investors are watching preliminary second‑quarter GDP figures for Germany and the wider Eurozone. The Eurozone is projected to grow 0.2% quarter‑on‑quarter after a 0.2% contraction in the prior period, with annual growth expected to rise to 0.4% from 0.3%.
Germany’s economy is forecast to remain flat quarter‑on‑quarter after a 0.3% rise, while annual growth is expected to increase to 0.6% from 0.4%. Softer‑than‑expected data could heighten concerns about the region’s economic outlook and weigh on the euro.
Germany’s preliminary July consumer price index will be closely monitored. Monthly inflation is projected to rise 0.7% after a 0.3% decline, with annual inflation having been 2.3%. Higher price pressure may reinforce expectations that the European Central Bank will keep a restrictive policy, thereby supporting the euro.
Short-term technical analysis:
The 4‑hour chart shows EUR/USD at 1.1372, with a bearish short‑term bias as the pair stays below the 20‑period SMA around 1.1391 and the 100‑period SMA near 1.1420. Momentum is weak, with the 14‑period RSI at 41, indicating limited buying interest and keeping downside pressure in focus while the pair remains under this layered resistance.
On the upside, the first resistance level is at 1.1375, followed by 1.1386 and a stronger barrier near 1.1391, where a horizontal line meets the 20‑period SMA, before the 100‑period SMA at 1.1420 becomes relevant. On the downside, the immediate support sits at 1.1369; a break below this level would likely trigger a further bearish move, whereas a hold above would keep the pair in a corrective consolidation within the resistance zone.
(The technical analysis of this story was written with the help of an AI tool. Know more.)